Assessing the Sustainability of Occidental Petroleum's Upcoming Dividend
Occidental Petroleum Corp (OXY, Financial) recently announced a dividend of $0.22 per share, payable on 2024-04-15, with the ex-dividend date set for 2024-03-07. As investors look forward to this upcoming payment, the spotlight also shines on the company's dividend history, yield, and growth rates. Using the data from GuruFocus, let's look into Occidental Petroleum Corp's dividend performance and assess its sustainability.
What Does Occidental Petroleum Corp Do?
Occidental Petroleum is an independent exploration and production company with operations in the United States, Latin America, and the Middle East. At the end of 2023, the company reported net proved reserves of nearly 4.0 billion barrels of oil equivalent. Net production averaged 1,234 thousand barrels of oil equivalent per day in 2023 at a ratio of roughly 50% oil and natural gas liquids and 50% natural gas.
A Glimpse at Occidental Petroleum Corp's Dividend History
Occidental Petroleum Corp has maintained a consistent dividend payment record since 1985. Dividends are currently distributed on a quarterly basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Occidental Petroleum Corp's Dividend Yield and Growth
As of today, Occidental Petroleum Corp currently has a 12-month trailing dividend yield of 1.20% and a 12-month forward dividend yield of 1.45%. This suggests an expectation of increased dividend payments over the next 12 months.
Over the past three years, Occidental Petroleum Corp's annual dividend growth rate was -4.20%. Extended to a five-year horizon, this rate decreased to -36.20% per year. And over the past decade, Occidental Petroleum Corp's annual dividends per share growth rate stands at -23.00%.
Based on Occidental Petroleum Corp's dividend yield and five-year growth rate, the 5-year yield on cost of Occidental Petroleum Corp stock as of today is approximately 0.13%.
The Sustainability Question: Payout Ratio and Profitability
To assess the sustainability of the dividend, one needs to evaluate the company's payout ratio. The dividend payout ratio provides insights into the portion of earnings the company distributes as dividends. A lower ratio suggests that the company retains a significant part of its earnings, thereby ensuring the availability of funds for future growth and unexpected downturns. As of 2023-12-31, Occidental Petroleum Corp's dividend payout ratio is 0.21.
Occidental Petroleum Corp's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Occidental Petroleum Corp's profitability 6 out of 10 as of 2023-12-31, suggesting fair profitability. The company has reported net profit in 6 years out of the past 10 years.
Growth Metrics: The Future Outlook
To ensure the sustainability of dividends, a company must have robust growth metrics. Occidental Petroleum Corp's growth rank of 6 out of 10 suggests that the company has a fair growth outlook.
Revenue is the lifeblood of any company, and Occidental Petroleum Corp's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Occidental Petroleum Corp's revenue has increased by approximately 14.90% per year on average, a rate that outperforms approximately 53.92% of global competitors.
Concluding Thoughts on Occidental Petroleum Corp's Dividend Profile
Considering Occidental Petroleum Corp's consistent dividend history, current yield forecasts, and payout ratio, the upcoming dividend appears to be sustainable. Despite a negative dividend growth rate over the past decade, the company's solid profitability and fair growth outlook provide some assurance for dividend-seeking investors. However, investors should continue to monitor the company's financial health and industry trends to ensure that their investment aligns with their financial goals.
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This article, generated by GuruFocus, is designed to provide general insights and is not tailored financial advice. Our commentary is rooted in historical data and analyst projections, utilizing an impartial methodology, and is not intended to serve as specific investment guidance. It does not formulate a recommendation to purchase or divest any stock and does not consider individual investment objectives or financial circumstances. Our objective is to deliver long-term, fundamental data-driven analysis. Be aware that our analysis might not incorporate the most recent, price-sensitive company announcements or qualitative information. GuruFocus holds no position in the stocks mentioned herein.
